CPL Plant

BY MATTHEW WINTER
SALISBURY POST

Carolina Power & Light today announced plans to build a $250 million power plant north of Salisbury to help the electric wholesaler keep up with customer demand during the extreme months of summer and winter.

CP&L will invest $250 million in the plant, use more than 100 workers during construction and hire about 20 permanent employees when the plant is finished in June 2001, company spokesman Mike Hughes said.

The company will build the new plant on a 142-acre site between U.S. 601 and Deals Creek, about three miles north of Salisbury. Hughes said the site is ‘‘perfect’’ because LS Power, another utility, completed some site preparation last summer for a similar plant it later abandoned.

Tim Russell, county manager, says the plant is the ‘‘one largest investment ever in Rowan County at one time.’’ If the company goes on the tax books at $150 million, it will bring in about $1 million in tax per year.

Russell said the county will provide the plant with water and sewer services, like it does for any other sizable industry.

The site also lies within a mile of a natural gas pipeline and is adjacent to a large Duke Power transmission line, which CP&L will use to transmit its electricity to customers.

The plant will house five to seven electric generators similar in function to large jet engines. The company will burn natural gas and other fuels to turn the engines’ turbines.

Each engine will be able to produce up to 160 megawatts of electricity. The plant is expected to increase CP&L’s capacity by 1,100 megawatts, approximately 11 percent.

The company will insulate each of the generators with ‘‘silencing technologies’’ and leave a 400-foot natural buffer zone between the plant and the company’s property line, Hughes said. The plant will meet all noise restrictions set by county zoning, he added.

CP&L sells electricity to the N.C. Electric Membership Corporation, which represents electric cooperatives throughout the state.

About four years ago the N.C. Electric Membership Corp. abandoned similar plans to build a $200-million electric power plant in Davidson County. During its search for a site, the Electric Membership Corp. narrowed its list to the Davidson site and property across the Yadkin River in Rowan County near N.C. 801.

CP&L recently signed new agreements with three large wholesale customers, including a plan to provide peaking capacity to N.C. Electric Membership Corp.

Although Hughes could not say how many local customers the plant may serve, he said the new plant will help all electric customers by insuring there is enough reserve capacity during the hottest summer days and coldest winter nights. Finding such reserve power is becoming an industry problem, Hughes said.

‘‘The electric utility industry is going through a lot of changes with deregulation,’’ Hughes said. ‘‘There isn’t much reserve capacity out there because many of the companies have not been willing to put up the investment to build a new plant with all the uncertainties of deregulation looming over them.

‘‘Last summer we had an unusually early peak time, and we saw wholesale prices in the Midwest and other areas rise dramatically. Prices were at about 30 to 50 bucks per megawatt hour, and they shot up to in some instances $5,000 to $7,000 per megawatt power.’’

Because of rapid growth in the region, utilities’ reserve margins for electric generation have steadily decreased, Hughes said. The Southeastern Electric Reliability Council recently released a report predicting that the capacity margins will fall below 10 percent by 2000 if utilities do not expand.

CP&L also is building new peaking generators at its Lee Plant in Wayne County and its Asheville Plant in Buncombe County. The company does not plan to raise rates due to these projects.

In a related move, CP&L announced last week a plan to buy North Carolina Natural Gas Corp. for better fuel prices for its power plants.

Headquartered in Raleigh, CP&L provides electricity to nearly 1.2 million customers in the Carolinas, including customers in central and eastern North Carolina.

CP&L maintains a system of 16 electric generating plants and 60,000 miles of power lines throughout its 30,000-square-mile service area.